Spend down assets - medicaid?

[JustMeUC]

I have always gotten good advice here so perhaps I can ask the smart folks here once again?

MIL is 90. Fairly good health. She has a bit under 100k in cash and currently in an assisted living facility costing 60k per year. SIL who has power of attorney over her finances is saying that if she spends down to zero in the next year and a half she will immediately become eligible for medicaid.

Is this the case? Any ideas or can you send me somewhere to do more research?

Thanks

 

[ivinsfan]

What does she have for assets besides cash? If her assets fall to the Medicaid threshold she would be eligible. However not all assisted living facilities accept Medicaid patients, so she might have to relocate, you can ask the place she is in now if they take Medicaid.

 

[pb4uski]

Probably right depending on what she spent it on. If she gifted it to family then it would cause an issue because of look-back provisions.

Does Medicaid pay for assisted living in her state? As I understand it, some will but others will only pay for nursing home care. Plus as pointed out, where she is may not take it.

You would be best off consulting an eldercare attorney on the best strategy for your MIL.

 

[JustMeUC]

All assets are in cash and no questionable gifts to children.

I think consulting an attorney who specialises in elder law is a good idea. We probably will do that in Ohio where she is to get better informed. We don't want any unpleasant surprises a year from now.

 

[marko]

Not sure if it's just our state (MA) but there's a five year look-back rule but if you can show where all the money went, it should be good.

As noted above, get an elder law attorney asap.

Of course there are few indeed around here who self finance themselves in assisted living/nursing homes. Had a relative years ago who wanted to pay his own way and the nursing home had to figure out how to bill him directly...they never hand that situation as everything they did was paid by the state. And he ended up in the same quality room as if the state was paying.

 

[rodi]

I don't think medicaid covers assisted living. It covers skilled nursing and, in some cases, memory units.

You or your sister should talk to the management/social worker at her current facility.

 

[shortstop14]

My mother had to move from a short emergency hospital stay to a memory care unit in Ohio a couple of years back. Her only real assets were a small amount of home equity and my deceased father's pension and Social Security. She is in a facility that accepts Medicaid. Her house needed to be sold, with the proceeds going to the memory facility. The pension (other than a few dollars a month) also goes to the facility, with Medicaid picking up the remainder.

So essentially she did need to spend down her assets before Medicaid took over.

 

[travelover]

Looking down the road.........Some nursing homes won't take Medicaid if patient is new, but will keep you if you start there as private pay. The catch is that each time patient goes to the hospital, you basically start over - they don't hold your room, so a patient may end up at a different facility when discharged from hospital.


Sent from my iPad using Early Retirement Forum

 

[audreyh1]

Your mother receives Social Security? That will also help cover her expenses.

There may have been some kind of agreement when she first moved into the place. Hopefully SIL knows about this.

 

[Bamaman]

I have always gotten good advice here so perhaps I can ask the smart folks here once again?

MIL is 90. Fairly good health. She has a bit under 100k in cash and currently in an assisted living facility costing 60k per year. SIL who has power of attorney over her finances is saying that if she spends down to zero in the next year and a half she will immediately become eligible for medicaid.

Is this the case? Any ideas or can you send me somewhere to do more research?

Thanks

She needs to find a cheaper assisted living. When my recently departed aunt was in assisted living, it was $2050 per month. We later had to get them to manage her medicines and it was another $500 per month. We also have a really nice assisted apartment complex with meals for more like $1,600 per month. Our full nursing homes are less than $60K per year.

 

[Dreaming of Freedom]

She needs to find a cheaper assisted living. When my recently departed aunt was in assisted living, it was $2050 per month. We later had to get them to manage her medicines and it was another $500 per month. We also have a really nice assisted apartment complex with meals for more like $1,600 per month. Our full nursing homes are less than $60K per year.

Where can you get into a nice assisted living facility for $1,600 per month? Or is this an independent living apartment complex?

 

[MBSC]

Medicaid is a state agency so you need to research how Medicaid in your state treats assisted living facilities compared to nursing homes.

Medicaid can be used to pay for long-term nursing home care in all states. Many states also allow their residents to use Medicaid waivers to pay for assisted living or in-home care if the services can be obtained at a lower cost. Each state has individual rules, regulations and eligibility requirements.

Links by state: State Medicaid Websites & Medicaid Waivers Directory

Income and Medically Necessary requirements:

Medicaid will pay for a nursing home only when it is medically necessary. In other words, you must show that you require a “nursing facility level of care,” meaning that you need the kind of care that can only be provided in a nursing home. In Ohio, there are two nursing facility levels of care, intermediate and skilled.

To receive Medicaid-paid nursing facility services in Ohio, you must need at least an intermediate nursing facility level of care. This means you must show that you need hands-on assistance with at least two of the following activities: bathing, dressing, eating, grooming, moving around, using the bathroom, and taking your medication.

If you are 65 or older and need long-term care in a nursing home, then you must have income at or below 300% of the SSI Federal Benefit Rate, or $2,163 per month in 2014, to qualify for Medicaid. (Ohioans who receive SSI already qualify to receive Medicaid.)

If your income is above the limit, you still might be able to qualify for Medicaid if the income you have over the limit doesn't cover your medical expenses. In Ohio, unlike some other states, people who are sixty-five and older can use unpaid medical bills, premiums, or nursing facility bills to “spend down” their income and qualify for Medicaid.

Reference: When Medicaid in Ohio Will Pay for Long-Term Care in a Nursing Home | Nolo.com

Gifting/Spending:

Q4. LET'S SAY MOM IS IN A NURSING HOME AND HAS $100,000. SHOULD MOM GIVE IT AWAY TO PROTECT IT?

A4. No. If mom just gives the $100,000 away to her child, and no exemption applies, she'll create a penalty period of about 19 months. That means the child will spend the entire $100,000 paying the nursing home bills over 19 months before mom gets help.

In many cases, we might suggest a partial gift combined with a Medicaid qualified annuity. Now, this gets very complicated. But with proper planning, mom might give away to her child about $40,000 to $50,000 of her $100,000 savings, make herself ineligible for Medicaid for about 9 or 10 months, and use the rest of the savings to pay for that period. After the 9 or 10 months has passed, mom will get Medicaid, and the $40,000 to $50,000 which was given away would be protected.

Reference: Ohio Medicaid Lookback

 

[spncity]

A physician must determine that she medically qualifies for the level of nursing home care that Medicaid requires. Sometimes a nurse from the facility or a geriatric case manager (independent contractor) can do a preliminary evaluation.

For reference only: Assisted living in some parts of Alabama can be had for $2375 per month. Memory Care assisted living (dementia needing assistance but still ambulatory and not medically complicated) is around $5,000 mo.

 

[Likes_to_Lurk]

Some very good advice here.

Re: elder care lawyer. Try to hire someone close to your MIL. They may be more familiar with how Medicaid is administered locally.

Generally, Medicaid will not pay for assisted living. But there are some state waiver programs. MIL's assisted living business office will probably know this.

Is MIL married? Very different rules apply here.

Was MIL ever married to a veteran? Depending on service period, the VA will contribute to assisted living expenses. Again, the assisted living staff will know the rules.

I've been through a lot of this with my mother. You are doing the right thing in researching this.

Best of luck.

 

[H2ODude]

Been through this with MIL. It is very state specific. We were told the AL facility (a fairly nice one, about $3500 a month) would take her and when she ran out of her money (started with ~$22,000) they'd take her as Medicaid. That meant moving her to a semiprivate room but still good. And then we went to apply for it....

Turns out that here in NC her ~$1300 a month in SS was IIRC ~$100 more than the state would allow, she was ineligible for AL. So this 89 yo woman who worked retail and supported self until 80 was expected to support self on $1200 a month (after paying SS each month). Used walker, needed some assistance but not skilled nursing. Hence BIL and DW split cost to keep her there, but only lasted a few months before the spiral accelerated.

So, before making plans you need to investigate closely. FWIW an eldercare attorney told us NC was likely to eliminate any AL assistance regardless of income.

 

[Walt34]

Again, see an elder law attorney now, before the assets are depleted. In FIL's case (Maryland) it is possible to structure assets so that half could be preserved. It is complex and you will need the attorney's help. It is NOT a DIY project.

Rodi is probably correct, as far as I know assisted living is not covered by Medicaid. But since it is a state-administered program your state may have a way to do that. Again, your SIL needs to talk with an elder law attorney, and soon. As in, as soon as she can.

 

[papadad111]

She needs to find a cheaper assisted living. When my recently departed aunt was in assisted living, it was $2050 per month. We later had to get them to manage her medicines and it was another $500 per month. We also have a really nice assisted apartment complex with meals for more like $1,600 per month. Our full nursing homes are less than $60K per year.

Curious jn what state are u located?

My DM is in Florida in assisted living. Running approx 4K per month for similar help with meds, etc. .

We are told that as assets get depleted to zero, mom can likely be "stepped up" to the skilled nursing wing and Medicaid will then cover. It's in the same facility. Odds are higher because she is already a resident and has paid for X years out of pocket. They can "find her" a space when that time comes. Nothing in writing, though so I'm not betting that's a done deal.

She has approx 4 years of cash at current burn rate before being broke and unable to pay the rent, but we siblings are now having the conversations among ourselves and with mom on various alternatives and options. We sold the house last year to have funds to cover her for 4-5 years. But with a major medical setback that money could be used in a flash if higher level care is required.

Good advice on elder care attorney etc.

 

[LARS]

I could be wrong, but I thought Medicaid does NOT cover assisted living, but only nursing homes (as crazy as that is given AL facilities are cheaper than nursing homes). So if eligible for Medicaid, then she would have to move to a nursing home...


Sent from my iPad using Early Retirement Forum